October 1, 2014 / 12:27 AM / 3 years ago

Vivint Solar prices IPO

Sept 30 (Reuters) - Residential solar panel installer Vivint Solar Inc priced its initial public offering at $16 per share, valuing the Blackstone Group LP -backed company at $1.68 billion.

Vivint Solar is offering all the 20.6 million shares, which were priced at the low end of the expected range, raising $329.6 million.

Lehi, Utah-based, Vivint Solar is currently the second-largest installer of residential solar panels in the United States after SolarCity Corp, which is backed by Tesla Motors Inc founder Elon Musk.

Vivint has benefited from a business model that allows homeowners to avoid the hefty upfront cost of buying a solar system outright.

The company puts the panels up on a house using funds provided by financial institutions and makes money by selling the power they produce to the homeowner for less than existing retail power rates.

Blackstone bought Vivint Solar’s parent company, Vivint Inc, in 2012 for more than $2 billion. Formerly known as AFX Alarm Systems, the company started selling alarm systems door-to-door in 1999.

Shares owned by 313 Acquisition LLC, a stockholder and an affiliate of Blackstone, will fall to 75.3 percent from 97 percent, assuming the underwriters fully exercise their option to buy additional shares.

Vivint Solar’s revenue rose more than five-fold to $10.06 million for the six months ended June 30, compared with a year earlier. The company’s net loss widened to $76.2 million during the period from $22.7 million a year ago.

The company said it plans to use the IPO proceeds to repay debt and for working capital. The company had about $78.3 million in long-term debt on a pro forma basis as of June 30.

The company’s shares are expected to start trading on the New York Stock Exchange under the symbol “VSLR” on Wednesday.

Goldman Sachs, BofA Merrill Lynch and Credit Suisse were among the underwriters of the IPO. (Reporting by Amrutha Gayathri and Sudarshan Varadhan in Bangalore; Editing by Sandra Maler)

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